The inaccuracies in Mr. Root's communication to his colleagues are troubling on several fronts not the least of which is: 1) his suggestion that voting no is a responsible course of action without consequences, 2)that the company can somehow continue to maintain the status quo as it relates to work rules and productivity, and 3) his ignoring the fact that by increasing the minimum fleet size to 279 mainline aircraft in combination with the increased feed from more RJs, that will mean more flying especially at the hubs and our focus cities and more jobs for CWA members.
When US Airways filed for Chapter 11 protection in August, it could have pursued a course that many companies do while in bankruptcy: shut down all unprofitable operations. That is certainly what K-Mart has been doing, closing hundreds of stores throughout the country. So the company could have pulled out of dozens of unprofitable markets and left employees and communities without any options. And we could have opted to seek abrogation of the labor contracts -- like United is currently doing. We could have also ignored requests by labor, including CWA, for seats on our board of directors. And we could have decided not to give our employees 31 percent of the stock of this company. But, instead we decided to find a way to make labor inclusive in this difficult process.
In addition, US Airways chose to find a way to preserve its network by strategically eliminating unprofitable routes and flights, but maintaining service to all but a few of the communities it previously served. And rather than simply slash service, routes and destinations, and limp along as a weakened carrier in a very competitive business the management team has built a strong business plan that relies on proven tools that will increase revenues, expand service, and position the airline for growth.
That being said, there are a number of small to medium sized communities that simply cannot support an all-mainline schedule and are the focus of the hundreds of regional jets that will be entering the US Airways system over the next several years. Let's talk Asheville, NC as an example. Today, we cannot profitably operate a full daily schedule with mainline aircraft and it has thus become an Express city. But, the morning and evening flights to CLT can clearly support a mainline trip. Assuming the CWA TA is ratified, we could fly mainline trips in the morning, Express trips through the middle of the day, and a mainline trip for the returning business travelers without raising the costs of the RJ trips. Thus, these two new mainline flights will mean added utilization flying for the mainline and more CWA hours at the hub.
Our growth domestically will also be propelled by the UA code share. This logically means more east-west flying on mainline jets from our hubs to west coast cities that we cannot profitably serve today on our own, such as Portland, OR. In addition, the increased RJ feed will also lead to the upgrade of some RJ flying to mainline jets.
So, because of the cost efficiencies and flexibility created by the new labor agreements, our mainline flying will not shrink further. And big airplanes need feed, and the RJs and the UA code share will supply that
feed. Without the passenger feed, and with our old cost structure, this added mainline flying would be a drain on the company's cash.
The tentative agreement reached with the CWA represents a compromise that was negotiated by both parties. We listened to the union on the issue of its members losing their jobs. That is why we withdrew numerous provisions that would have called for the outsourcing of CWA work. Compromises are never perfect but they reflect the input and the interests of both parties. The new management team has been hard at work since March finding a way to save a company that many experts have given up for dead and to
save the jobs of more than 30,000 loyal employees. The negotiations with all of the labor groups have been challenging and difficult, but they reflected the company's desire to work with labor to save the company. Now without offering any alternative, Mr. Root has advised his colleagues to reject the TA, and put at risk their jobs and the welfare of their families. Mr. Root believes management is bluffing. The reality is simple. If we are unable to secure the ATSB loan guarantee, our investor(RSA) will walk away. And there are no white knights waiting to invest in us. His comments represent dangerous and irresponsible recommendations..
Chris Chiames
Sr. Vice President, Corporate Affairs